Power firms piled N62bn energy debt in 2 months – Report | Dailytrust

Power firms piled N62bn energy debt in 2 months – Report

The 11 Distribution Companies (DisCos) could not pay N62.167 billion of the N138.633bn worth of energy invoices they received for power generation in January and February 2022.

And apart from Eko DisCo (in January) and Port Harcourt DisCo (February), the other nine DisCos failed to meet a Minimum Remittance Order (MRO) set out by the Nigerian Electricity Regulatory Commission (NERC) for them in each of the months.

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Daily Trust’s analysis of market payment reports by the Nigerian Bulk Electricity Trading PLC (NBET), indicates that the 11 DisCos got N138.633bn energy invoice in January and February; NERC expected them to pay N126.851bn as 91% MRO but the DisCos could only raise N76.466bn for the months, which is 55% of the total sum, leaving them with N62.167bn debt or 45% of the total payment.

In January, the 11 DisCos got N72.301bn energy invoice in January and were expected to pay N63.245bn as 87.5% MRO but the DisCos could only raise N36.652bn for months, leaving them with N35.649bn debt or 49.31% of the total payment.

The amount remitted by the DisCos was just 50.69% of the N72.3bn, which translated to about 30% short of what NERC had ordered them to remit for January.

Eko DisCo met the requirement of the MRO in the January payment as the 10 other DisCos failed it although NBET said subsequent payments were expected from DisCos with outstanding MRO payments.

A breakdown of the N35.6bn debt indicates that Kaduna Electric led the debtor’s list with N5bn debt followed by IBEDC with N4.9bn and Benin with N4.7bn; the least debtor was EKEDC with N1.2bn. Other debtors are Enugu (N3.2bn), PHEDC N3.1bn, KEDCO N3bn, Ikeja N2.9bn, JEDC N2.69bn, Abuja owed N2.6bn and YEDC owed NI.19bn.    

For the February payment, the 11 DisCos got N66.332bn energy invoice and were expected to pay N63.606bn as 95.89% MRO but the DisCos could only raise N39.814bn or 60.02% for the month, leaving them with N26.517bn debt or 35.87% short of the total payment. Their payment was also 62.6% of the 95.89% MRO set by NERC for February.

PHEDC met the MRO in February as the 10 other DisCos failed to do that but NBET said subsequent payments would be expected from the DisCos.

A breakdown of the N26.5bn debt indicates that the least of the debtors are PHEDC with N459m and Eko with N790m. Kaduna Electric, which was ordered by NERC to pay 100% of its N5.217bn invoice owed N4.7bn as it only paid N447 million. Its next peer was Ibadan expected to pay 100% of the N8.267bn invoice, paid N3.5bn and owed N4.6bn while Enugu paid N3.5bn instead of N6.4bn (100%) and owed N2.8bn. 

Kano ought to pay N4.9bn (100%) but paid N2.3bn and owed N2.6bn; BEDC owed N2.8bn, Jos owed N2.4bn, Yola owed N1.9bn, Ikeja owed N1.8bn and Abuja owed N1.2bn.

The monthly energy payment remittance indicates how healthy each of the 11 DisCos is, relative to their service delivery of power supply to the over 10 million registered electricity consumers in Nigeria.

 

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